> ## Content Index > Fetch the complete content index at: https://icopilots.com/llms.txt > Use this file to discover other available public pages before exploring further. # 🟢 Market volatility has become a feature of innovation strategy - URL: https://icopilots.com/market-volatility-has-become-a-feature-of-innovation-strategy/ - Published: 2026-04-29T08:26:04.000Z - Updated: 2026-04-29T08:26:04.000Z - Description: The VIX is reaching mainstream audiences, and it signals that dealing with uncertainty is reaching mainstream awareness for the next five years of innovation strategies. - Author: Philippe MEDA - Tags: Newsletter, Innovation Strategy, #volatility, #risk, #innovation strategy, #portfolio In early April 2025, following the tariff package announced as "Liberation Day" by the Trump administration, the **VIX** (or *CBOE Volatility Index* **)** spiked to approximately 52, a level last seen during the market dislocations of March 2020\. Since then, Bloomberg has published multiple explainers on the VIX, aiming to help its business readers without a PhD in finance get used to this index. The VIX is moving from a specialist instrument for derivatives traders to a general-purpose indicator of how much the world no longer "makes sense," with direct implications for how large organizations should structure their innovation investments. Something has shifted. ### What the VIX actually measures The VIX (formally, the Chicago Board Options Exchange **V**olatility **I**nde**x**) measures the implied volatility of S&P 500 options over the next 30 days. Seems simple enough. Well, yes, but the distinction between *implied* and *historical* volatility is the critical one: **the VIX doesn't describe past volatility but reflects what investors collectively price in as future uncertainty. It is a quantification of the range within which investors currently believe prices might move.** Me? I just call it the nervousness index. What you need to know is that when the VIX sits around 12-15, as it mostly did from 2013 to 2017, markets are pricing in relatively orderly near-term conditions. From 15 to 30, nervousness appears quite clearly. When it reaches 50, markets are pricing in the possibility of severe, unpredictable swings. ![](https://storage.ghost.io/c/8f/a3/8fa3eb46-8b94-4e7c-85af-c9fe45614239/content/images/2026/04/image.png) What makes the instrument analytically interesting for strategy leaders is not that it predicts anything. **What it does is make the degree of collective uncertainty legible as a single number.** I don't argue that innovation directors should monitor option-implied volatility daily, but rather that the structural conditions which produce persistently elevated VIX readings are the same conditions that fundamentally alter the economics and logic of long-term strategic investment... Which most corporate innovation processes were designed to operate within. ### Five years of structural uncertainty My current and most important work assumption (and I acknowledge this is pure inference, as there is no established certainty here) is that we are looking at a minimum of five years before any of the current structural tensions settle into an equilibrium stable enough to plan against with *conventional* innovation methods. Your typical stage-gate ideation program, delivering "good ideas" that will be refined and maybe see the light of the market in 2028 or 2029? It's currently the worst innovation tool available. The US-China technology decoupling, which accelerated sharply with the CHIPS and Science Act of 2022 and has intensified through successive rounds of semiconductor export controls targeting NVIDIA, ASML, and others, is not a trade dispute with a resolution clause. The European defense and energy realignment following Russia's full-scale invasion of Ukraine in February 2022 is similarly not a temporary adjustment. Monetary environments across the G7 remain difficult to stabilize after the inflationary episode of 2022-2024\. And [the pace of AI deployment](https://icopilots.com/the-pace-layers-of-innovation/) is creating second-order competitive effects across industries faster than most strategic planning cycles can process. And we still don't know how and when the petrol crisis will hit us (remember petrol is energy and plastics, among many other things). Just yesterday, the UAE left OPEC. Have fun factoring this into the cost structure of your 3-5 year innovation cycle. And these risks? They compound. As I have been arguing in the context of [Grey Swan events and the emerging class of risks we are now navigating](https://icopilots.com/risks-are-getting-weirder-here-are-the-grey-swans/), the distinguishing feature of the current environment is not that these risks are unforeseen in type (protectionism, tech disruptions, energy shocks). Everything was entirely within the range of discussable scenarios before 2024\. But their timing, magnitude, and interaction effects cannot be predicted. They become [chaotic](https://icopilots.com/cruising-in-chaos-part-1-the-cynefin-framework/). Naturally, this creates a very specific problem for organizations whose strategic architectures are built for a stable environment, one where the planning horizon held still long enough for a 3-5 year bet to mature. ### The single-bet model is out As such, the dominant model of corporate innovation investment over the past decade was, OK, enough, and admittedly well-suited to low-volatility conditions. Identifying the highest-confidence strategic bet, concentrating resources behind it, and executing at scale made sense when market structures remained relatively stable long enough for the wager to play out. Renault's aggressive commitment to an all-electric transition built around the Mégane E-Tech platform, or Intel's prolonged doubling-down on internal manufacturing capacity under its IDM 2.0 strategy, while TSMC was quietly becoming indispensable across the industry, these are examples of concentrated strategic bets made when the cost of being wrong was still manageable and the environment held still. The thing is that both have encountered serious turbulence since, for reasons that were broadly foreseeable in type but absolutely *not in timing*. This pattern is not unique to those two companies; it is the dominant failure mode of the current strategic moment. The organizations that will emerge from this period will not be those with the best individual bets. **They will be those that built the organizational capability to hold multiple strategic options at different development stages, size their commitments proportionally to the resolution of uncertainty, and accelerate or abandon positions as information arrives.** Sadly, this is structurally different from how most corporate innovation portfolios currently operate. Blame business schools, consultants, or just reading too many LinkedIn posts, but in our current organizations, diversity of projects is treated as a negative risk-management issue rather than as the primary operating logic. Of course, I'm not advocating either for dispersing investment thinner across random projects. Still, not a strategy. The discipline lies in staging different horizons of *combined* risks/opportunities, how early signals are read, and how decisions are made when information is still incomplete. Here again, I will have to remind you that this is precisely the situation that [Pierre Wack's scenario work at Shell in the 1970s](https://www.icopilots.com/understanding-why-we-make-predictions/?ref=icopilots.com) was designed to address. If history repeats itself, we seem to fail at learning anything from it. ### Uncertainty is *the* competitive differentiator The VIX going mainstream is a late signal of something that practitioners in non-linear strategy have been watching for some time and, frankly, waiting for the broader management conversation to catch up with. Across my work with large European industrial groups over the past several years, the pattern has been consistent: organizations that were already running structured uncertainty-management processes, including [retrograde analysis and portfolio-level option-staging](https://www.icopilots.com/retrograde-analysis-an-innovation-tool-to-deal-with-high-uncertainty/?ref=icopilots.com), entered the current period of volatility with meaningfully more room to maneuver than those whose strategic planning remained oriented toward a single primary scenario. No surprise, Sherlock. But there's still time to catch up, even if it does involve pushing the reset button on quite a few innovation programs ever so slightly (it's rather easy to nudge them away from a straight-face "we can see the future" predictability mindset toward [investing in uncertainties](https://icopilots.com/the-safest-thing-you-can-do-right-now-is-to-take-more-risks/)). The companies that will define market leadership over the next five years will be identifiable less by which technology or market they committed to than by how they managed the period of structural not-yet-knowing and how they built organizations capable of remaining responsive rather than locked into commitments made when the world was relatively stable. **Uncertainty management at this scale is not a soft skill or a cultural initiative but an architectural question about how innovation portfolios are built, how resources are staged, how options are valued, and how organizations make decisions under persistent information constraints.** It's about not playing at the casino but [becoming the casino](https://icopilots.com/crusing-in-chaos-part-4-the-logic-of-becoming-the-casino/). --- ### More on this: [No, a portfolio strategy is not ‘spray and pray’A few days ago, I pinned a long-form article by Dan Gray for further discussion. The article was reposted on LinkedIn from Twitter. The post was about the difference between VCs that try to invest smartly and those who simply pursue large numbers of investments and ‘spray and pray.’![](https://static.ghost.org/v5.0.0/images/link-icon.svg)innovation copilotsPhilippe MEDA![](https://storage.ghost.io/c/8f/a3/8fa3eb46-8b94-4e7c-85af-c9fe45614239/content/images/size/w1200/2025/07/photo-1516794840430-8d8c51e7c045.jpeg)](https://icopilots.com/no-a-portfolio-strategy-is-not-spray-and-pray/) [Cruising in Chaos - Innovation CopilotsDealing with chaos in your market? We make bold innovations operational and effective.![](https://storage.ghost.io/c/8f/a3/8fa3eb46-8b94-4e7c-85af-c9fe45614239/content/images/icon/faviconV2.png)Innovation CopilotsInnovation Copilots![](https://chaos.icopilots.com/og-image.png)](https://chaos.icopilots.com/?ref=icopilots.com) [🟢 The explore/exploit fallacy in innovationI’m encountering more and more this explore/exploit framework with the innovation departments of large corps. Explore/exploit means that they are two modes in the organization. Some teams will be in the first one, while the rest of the organization will be in the other: Thank you, Osterwalder, for![](https://static.ghost.org/v5.0.0/images/link-icon.svg)innovation copilotsPhilippe MEDA![](https://images.unsplash.com/photo-1508737896714-62db8b4dbfe2?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=MnwxMTc3M3wwfDF8c2VhcmNofDI4fHxjb3dib3l8ZW58MHx8fHwxNjQ4MDUwODQ1&ixlib=rb-1.2.1&q=80&w=2000)](https://icopilots.com/the-exploit-explore-fallacy-in-innovation/)